Ratings agency CRISIL has downgraded the rating on Corporation Bank’s tier I and II bonds. The asset quality and income profile and profitability of public sector lender are expected to remain under pressure. The rating for Corporation Bank’s capital instruments have been revised from ‘AA’ to ‘AA-’. The rating, nevertheless, continues to factor in the support lenders are likely to receive from their majority owner Government of India.
The Corporation Bank’s asset quality stress will stay elevated over the next few quarters with continued slippages, especially in the corporate book and limited recovery of NPAs.
